No reason for Canada to delay appliance efficiency standards

On May 20th a Canadian Press article reported The Association of Home Appliance Manufacturers’ (AHAM) critique of proposed appliance energy efficiency regulations. This blog responds to the article.

Appliance efficiency standards are in the news because the federal government is currently consulting on Amendment 17 to the Energy Efficiency Act, which will increase mandatory minimum energy performance standards for home appliances. In 2019, the Minister of Natural Resource’s mandate letter included direction to “make ENERGY STAR certification mandatory for all new home appliances starting in 2022.”

Natural Resources Canada is interpreting this direction to increase the minimum standards for the energy efficiency of household clothes dryers, clothes washers, dishwashers, refrigerators, and freezers to align with the ENERGY STAR performance levels that existed in December 2019. Updated standards are also proposed for air conditioners and heat pumps. The new regulations will come into force after July 1, 2023. 

ENERGY STAR enables alignment with global markets

AHAM notes that the Biden administration plans to establish new energy efficiency rules, and that Canada should wait to harmonize with the US when these standards are created. However, this recommendation serves to needlessly delay progress in Canada.

Using ENERGY STAR as a benchmark to establish regulations ensures Canada remains “harmonized” with North American markets. ENERGY STAR is a global energy efficiency performance program, led by the US Environmental Protection Agency. The proposed regulations will simply require the more efficient products on the global market to be sold in Canada.

Following AHAM’s suggestion to wait for the Americans to update their standards would lock Canada into the current US regulatory lag. While Canada previously caught up to the standards created by the Obama administration, appliance efficiency progress stalled in the US under Donald Trump. The US political system also takes significantly more time than Canada to adopt and then enforce regulations.

Given the ambition of Biden’s climate agenda and the longer timeframes required to update American regulations, we anticipate that the US will eventually adopt appliance efficiency minimums higher than current ENERGY STAR levels.

If Canada were to delay, it would result in more emissions and higher energy costs. By using ENERGY STAR as a benchmark, we can be aligned – but ahead – of the US and be better prepared to align with the even higher standards likely to come. 

Since Canada has more flexibility to adopt regulations, we should take advantage of it. Natural Resources Canada is also taking steps to increase its flexibility to align with future US policy changes.

ENERGY STAR products are available today

The manufacturing association argues fewer models will be available by quoting the percentage of products on market. Yet, consumers will have significant choice amongst energy efficiency options. See the table below, which presents the number of ENERGY STAR models currently available in the Canadian market. 

Source: ENERGY STAR Product Finder (May 25, 2021)

The article noted specific products like top-load washing machines, where 88 models are available; and refrigerators with freezers on top where 442 models are available.

AHAM also raises pandemic related supply chain issues. While the pandemic has certainly impacted supply chains, the proposed Canadian regulations will not apply until July 2023 – a time when the pandemic is hopefully well behind us. 

Ensuring lower income Canadians benefit from energy efficiency

The potential impact on lower income Canadians will also be considered as part of the regulatory consultation. Our goal should be to expand the benefits of energy efficiency to lower income Canadians. More efficient appliances reduce low-income energy burdens by reducing operational costs. 

The slightly higher up-front cost of some efficient appliances should not be used as an excuse to delay climate action. Rather, it increases the need for the federal government to introduce a comprehensive and well-funded low-income energy efficiency strategy. 

A “no regrets” approach

Creating Canadian appliance efficiency standards based on ENERGY STAR is a no regrets approach because it is a standard aligned with global markets, with products already available for purchase. 

By introducing higher efficiency standards, we will just be ahead in reducing emissions and reducing energy costs for Canadians. This is not something we should delay.